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File Number: 15-485 <br />extensive and complex; as a result there are diminishing returns on extensive and expensive <br />efforts to make them perfect. Consequently, staff carefully limits the amount of detail and <br />coordination effort written into the plans and specifications. The effort, cost, and duration of <br />design is balanced with the cost of making adjustments to the work while in construction. <br />Additionally, the California Public Contract Code requires, subject to certain exceptions and <br />specific provisions for other project delivery methods, that the City award contracts to the <br />lowest responsive bid submitted by a responsible bidder. The practical effect of this legal <br />requirement is that contractors often narrowly interpret the plans and specifications, which <br />sometimes excludes work for which there is less than optimum written detail, or drawings. <br />Moreover, the design-bid-build project delivery method is a competitive process, such that the <br />same contractor is typically not used on every single project. This method has the practical <br />effect of preventing public agencies from developing a relationship that might result in a <br />contractor placing bids based on the design intent of the City as project owner, instead of the <br />precise language in the plans and specifications. <br />Analysis <br />On each construction project the City expects to find some unforeseen conditions that will <br />change the scope of the work. Staff also expects that when the contractor installs the work, <br />staff will find that some details on the plans need adjustment, and that the contractor will <br />exclude work that staff intended the contractor perform from the bid based on a narrow <br />interpretation of the contract documents. The cost to address these issues typically ranges <br />from 5% to 25% of the original bid price provided they are addressed in a timely manner. <br />Delaying work to negotiate and interpret these changes can cost thousands of dollars a day <br />and can easily double the cost of the added work if issues aren’t addressed immediately. On <br />occasion the City receives favorable bids and therefore the Change Order limits allows the <br />City to take advantage of the low cost and complete more work and also allows us to fully take <br />advantage of available grant funds for a project. <br />In order to cover the cost of change orders necessary to resolve the conditions described <br />above the City carries contingency funds on each project. The amount of contingency funds <br />varies from 10% to 25% of the original bid depending on the complexity of the work and <br />sensitivity of the work to unforeseen conditions. To harmonize fiscal internal controls, <br />purchasing policies and procedures with the Municipal Code, the City Charter and State law, <br />staff requests City Council delegation of authority to the City Manager to negotiate change <br />orders. For the following projects, this action doesn’t change their budgets or require any <br />appropriations. Change orders will be limited not only by the percentage limits of the related <br />resolution but also by the amount of funds appropriated to each project. <br />Authorizing the City Manager to negotiate and approve change orders will minimize delay on <br />these projects and ensure that the scope of work is adjusted as needed to provide the highest <br />quality project for the City. <br />Previous Actions <br />·On July 5, 2011, by Resolution No. 2011-132 the City Council awarded a contract for the <br />Water Pollution Control Plant Rehabilitation project to S.J. Amoroso Construction Co., Inc. <br />Page 2 City of San Leandro Printed on 9/2/2015